Statkraft, Europe’s largest renewable energy producer, announced substantial provisions in the second quarter to reflect asset impairments in Europe and India.
The Norwegian company, wholly owned by the Norwegian state, operates in approximately 20 countries, with activities in hydropower, wind, solar, gas, and battery storage.
Profitability Challenges in Renewables Sector
Like the rest of the renewable energy sector, Statkraft is experiencing a decline in profitability due to high interest rates and falling electricity prices.
On Tuesday, the company reported a net loss of 1 billion Norwegian kroner (84 million euros) for the second quarter, compared to a profit of 5.5 billion kroner a year earlier, primarily due to significant provisions.
Hydropower Impairments in Albania and Turkey
In Albania and Turkey, Statkraft impaired its hydropower assets by 3.1 billion kroner due to a downward revision of expected production.
In Germany, 841 million kroner were provisioned to reflect lower-than-expected future wind power prices, and another provision of 348 million kroner was made for hydropower in India.
Revenue Decline and Falling Electricity Prices
Quarterly revenue fell to 11.2 billion kroner from 12.9 billion kroner a year ago, mainly due to a drop in electricity prices in Northern Europe and Germany (-38% and -46%, respectively).
While prices have fallen, electricity generation for the entire quarter increased by 1.3 TWh year-on-year to 14.4 TWh.
Underlying Operating Profit Decline
Underlying operating profit amounted to 4.9 billion kroner, a decrease of 34%.
Statkraft, which recently acquired the Spanish wind and solar company Enerfin, announced in June a slowdown in its growth rate.
The company now plans to install between 2 and 2.5 GW of new capacity in onshore wind, solar, and battery storage from 2026 onwards, compared to an initial annual target of 2.5 to 3 GW from 2025 and 4 GW from 2030.
Reduced Offshore Wind Ambitions
In offshore wind, Statkraft now aims to deploy between 6 and 8 GW by 2040, compared to the previously planned 10 GW.